The Australian Energy Regulator (AER) has made a draft decision on the amount of revenue Powerlink in Queensland is allowed to recover from energy consumers using its transmission network in the 2022–27 regulatory period.
The draft decision allows Powerlink to recover $3,652.2 million (nominal) from its consumers during the five-year regulatory period starting 1 July 2022, a $243.1 million (6.2 per cent) decrease in revenue compared to the current 2017–22 period.
Powerlink put forward a well-informed proposal, underpinned by significant consumer engagement. Based on the positive views of stakeholders, Powerlink’s substantial time and resource commitment to developing its proposal has been well invested.
Powerlink had an objective of submitting a proposal that was capable of acceptance and following our assessment, we have been able to accept much of Powerlink’s proposal including its total operating and capital expenditure.
Powerlink’s proposal serves as an example of the preferred approach to revenue proposals as outlined in the AER’s draft Better Resets Handbook – Towards consumer-centric network proposals, released this month for consultation. The Handbook supports network businesses to develop well-justified proposals that are based on strong consumer engagement.
We estimate that if this draft decision is implemented, compared to the current total bill level (as at 30 June 2022), the transmission component of the average annual nominal electricity bill for Powerlink’s consumers would:
- decrease by $12 (0.8 per cent) for residential consumers, $17 (0.8 per cent) for low‑usage small business consumers, and $44 (0.8 per cent) for high‑usage small business consumers in the first year (2022–23) of the 2022–27 period
- increase on average by around $3 (0.2 per cent) for residential consumers, $4 (0.2 per cent) for low‑usage small business consumers, and $10 (0.2 per cent) for high‑usage small business consumers in each of the following four years of the 2022–27 period.
There are few areas remaining for resolution between now and our final decision, with these areas generally limited to the application of incentive schemes and the usual data updates we undertake in our models for the 2022–27 period.
Powerlink now has the opportunity to consider the draft decision and submit a revised proposal by 3 December 2021. The AER will make a final decision by 29 April 2022.
A final round of targeted and public consultation will also take place, including an online forum hosted by AER Board member Eric Groom on Wednesday, 13 October 2021. To register your interest in the online public forum, please email Powerlink2022@aer.gov.au.
We invite energy consumers and other interested parties to make submissions on our draft decision for Powerlink by 14 January 2022.
Submissions should be sent to: Powerlink2022@aer.gov.au.
Alternatively, you may mail submissions to:
Mr Warwick Anderson
Australian Energy Regulator
GPO Box 3131
Canberra, ACT, 2601
We prefer that all submissions be publicly available to facilitate an informed and transparent consultative process. We will treat submissions as public documents unless otherwise requested. All non-confidential submissions will be placed on the AER's website. For further information regarding the AER's use and disclosure of information provided to it, see the ACCC/AER Information Policy.
We request parties wishing to submit confidential information:
- clearly identify the information that is the subject of the confidentiality claim
- provide a non-confidential version of the submission in a form suitable for publication
The AER is holding an online forum on the draft decision. The forum details are:
Date: Wednesday, 13 October 2021
Time: 3pm to 5pm (AEDT)
The public forum will allow us to explain to stakeholders our draft decision and the key issues that led to our draft decision. Interested parties will have an opportunity to ask questions.
If you would like to attend, please send your name and contact details to the AER via email to Powerlink2022@aer.gov.au. The agenda will be emailed to registered participants prior to the online forum.